PRESIDENT BUSH ANNOUNCES NEW U.C. PROGRAM
The
following is the release
dated January 7, 2003
of President Bush's new
Unemployment Compensation
Program.
Fact
Sheet: President Bush Takes Action to Help Unemployed Americans Get Back
to Work Quickly
The Action
President
Bush proposes to give states $3.6 billion to promote Personal Reemployment
Accounts to Americans who need the most help getting back to work.
These funds
will enable states to offer accounts of up to $3000 each to eligible individuals
to purchase job training and key services, such as child care and transportation,
to help
them look for a job and get back to work quickly. Recipients will be able
to keep the balance
of the account as a cash reemployment bonus if they become reemployed
within 13 weeks.
Personal
Reemployment Accounts are a flexible new approach to giving the unemployed
more control over their access to training and services and help them
make a quick return to
work. States will have considerable flexibility in designing the account
program.
President
Bush's new program will allow states to serve at least 1.2 million Americans
most
in need of help getting back to work.
The Concept
As part
of the existing unemployment benefit proposal, all states identify individuals
likely to
exhaust unemployment benefits before becoming reemployed. States use factors
such as
prior employment in a declining industry, education level, and length
of recent job tenure.
States will
have the option of offering personal reemployment accounts to the following
groups of unemployed workers:
New or
existing unemployment beneficiaries who are identified as "somewhat
to very
likely to exhaust" unemployment benefits, and
Former
UI claimants who have exhausted all their unemployment benefits within
the
three months prior to the effective date of the enactment of the program,
and who
meet one of the following criteria: (1) they are successfully in training
and need extra support to complete training; or (2) they have worked
in industries or occupations that are declining or no longer functioning
in the local labor market (within the past 2 years). States will have
the option of choosing additional targeting criteria.
States will
be able to target this flexible new benefit to those individuals most
in need of
help getting back to work by offering Personal Reemployment Accounts of
up to $3000,
based on the specific conditions in each state.
The accounts
will give eligible unemployed workers the power to purchase training,
supportive services (e.g. child care, transportation), and intensive services
(e.g., employment counseling, case management). The accounts will be administered
through the One Stop Career Center system and individuals will be given
broad flexibility to purchase the services of their choosing, within broad
limits to prevent abuse.
In addition,
states will have the option to allow eligible individuals who have exhausted
all unemployment benefits to use account funds as income support, similar
to unemployment benefits, until they become reemployed.
If an account
holder becomes reemployed within 13 weeks, he or she will be able to keep
the remaining balance of the account as a reemployment bonus. For new
unemployment benefit recipients, the 13 week period begins to run when
they begin to receive UI. For individuals who are already receiving unemployment
benefits or have exhausted unemployment benefits, the 13 week period begins
to run when they become eligible for the account. To encourage workers
to stay on the job longer, the remaining balance will be paid in two installments
(60% at employment and 40% after 6 months job retention).
Benefits
of Reemployment Accounts
Because
account recipients can keep the balance of their accounts when they become
reemployed quickly and stay employed, they create an incentive to get
off unemployment
benefits and back to work more quickly. The more quickly a job is obtained,
the larger the
reemployment bonus will be.
The reemployment
bonus also makes it easier for individuals to afford to make the transition
to a new, more vibrant industry.
Reemployment
accounts also make it easier for individuals to take advantage of training
and
services to help them get back to work and give them more flexibility
and personal choice of
their services.
The more
quickly a job is attained, the shorter the period of unemployment benefit
payments.
